Patten and Company

Net Operating Loss

A net operating loss (NOL) occurs when a business’s operating expenses and other deductions for the year exceed its revenues. On the bright side, you can claim an NOL deduction if your business’s expenses exceed its income (though certain modifications apply). Generally, once you incur a qualifying NOL, you can either carry it back as far as allowable (typically two years) and then carry forward any remaining amount, or you can elect to carry forward the entire loss. Choosing the best approach can be tricky, so please give us a call for help.

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Understanding Seller’s Discretionary Cash Flow (SDCF)

A Valuation Metric Just for Small Businesses: Valuing a small business, like a mom-and-pop restaurant, requires a different approach than what you’d use for a large corporation. Traditional valuation methods, such as discounted cash flow analysis or price-to-earnings multiples from publicly traded companies, are often too complex and irrelevant for small businesses. Instead, valuation advisors turn to a more suitable metric: Seller’s Discretionary Cash Flow (SDCF).

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Planning for a Business Loan: How to Be Prepared and Secure the Best Terms

At Patten and Company LLC, we understand the unique challenges and opportunities businesses face to secure funding. If you’re building a small business and haven’t yet needed to borrow funds to expand or smooth out cash flow irregularities, you’re doing something right. And if you have borrowed and everything went smoothly, kudos again. For those who foresee the need for credit in the future, anticipating this need well in advance can significantly enhance your ability to secure a loan with competitive terms.

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